Even with the analysts lowering price targets, Roblox still has good news.
What Had Happened?
The popular gaming platform Roblox’s share (RBLX -6.05%) that had catered to the elementary-school set had seen a surge up to 8.6% on Wednesday at 12:35 p.m. ET, after stock price targets were downgraded by the Wall Street analysts.
So Then What?
The February metrics reported by Roblox showed:
- The daily active users had risen 28% to 55.1 million years over year.
- The user engagement had been up to 21% at 3.8 billion, year over year.
- Nevertheless, the estimated bookings (i.e. Robux purchases) had declined 2 to 4% year over year, to a range of about $203 to $206 million.
This appears as bad news with the warning from Roblox that the average daily active user bookings (how much is spent by each user to get Robux) had seen a decline from 24% to 25% year over year to somewhere between $3.68 to $3.74 in the month of February. Considering this, the analysts Needham and Stifel Nicolaus had lowered the Roblox stock prices to about $65 and $60 per share respectively, as reported by Streetinsider.com.
It was probably the right step, seeing that the Roblox growth stock booking should go up instead of down. Nevertheless, as the number of users and engagement numbers still rise, Roblox said that it still thinks that the revenue had grown by 60% at least in February, year over year.
With the Roblox stock at $41 and change, investors were ready for hearing the worst news. Nevertheless, if Roblox does grow its revenue well, it still will be a stock worth buying. Despite the %60 or $65 per stock forecasts, the analysts still consider Roblox stock, predicting 50% or more price share games over the next year.
Not surprisingly, Roblox Shares still go up today.
Investing $1000 in Roblox; Should I?
Before considering it, you’d want to know that Roblox isn’t one of the best 10 stocks to invest in as of now.